The Board of Directors of Russian Railways has decided to sell 25% of the shares of the largest manufacturer of ferroconcrete sleepers, Beteltrans, toT-Industry for 1.5 billion rubles, according to its own materials. T-industry is an entity associated with the son of Prosecutor General Igor Chaika: 70% of this company, according to SPARK-Interfax, belongs to the Dutch Spoor Structuur Investering B.V. (Its beneficiary is not known), and 30% to Aqua Solid LLC, where the son of the Prosecutor General has 99%.

T-Industry already owns 50% minus 2 shares of Beteltrans, the package was bought in 2014 for 3 billion rubles. The Ministry of Economic Development agreed to increase the package of T-Industry with the Ministry of Transport and the Federal Property Management Agency in August. And in the autumn the government approved the sale "at a price not lower than the market price" and "not lower than the nominal value." 1.5 billion rubles is the price that T-Industry immediately offered to Russian Railways for the package. These are attractive conditions for RR: Beteltrans is valued at a multiplier of 10 EBITDA (in 2014, 9 EBITDA), although the company's revenue and net profit in 2015-2016 were lower than in 2014, says Mikhail Burmistrov, general director of Infoline Analytics.

Russian Railways in the materials disclosed the terms of the share agreement, which it will conclude with T-Industry. In particular, each of the shareholders of Beteltrans has a preemptive right to purchase a partner package. T-Industry is also obliged to buy from RR the remaining package of Beteltrans, if the monopoly will have such a desire. This should happen within a year from the date of the termination of the contracts between RR and Beteltrans for the supply of products, indicated in the materials of the monopoly. In 2012-2013, Beteltrans won the tenders of Russian Railways for the supply of products for 269 billion rubles until 2017. The buyout price of the remaining 25% of the company's shares is at least 1.5 billion rubles.

At the same time, the agreement significantly limits the rights of T-Industry. Thus, the company is obliged to agree with Russian Railways on the options for voting on issues related to the resolution of interested-party transactions between the monopoly and / or its affiliates and Beteltrans, which relate to changes in the delivery of sleepers under long-term contracts. In addition, the controlling shareholder will have to agree with the minority stance on changing the charter, reorganizing the enterprise and changing the authorized capital. T-Industry should keep the capacity of the enterprise until 2020 at the level of 10.5 million sleepers per year. The transfer of shares will take place only after Beteltrans will forgive Russian Railways the fines and penalties accrued since 2015 for failure to fulfill obligations to buy the minimum volume of production. "Now the railway tracks are being updated for the 2018 FIFA World Cup. The budget for the purchase of sleepers has been allocated, it is quite possible that RR needs such stringent conditions for indirect control over the company on key issues," BMS Law Firm partner Denis Frolov suggests.

The FAS approved the increased share of T-Industry. According to the Federal Antimonopoly Service, Beteltrans takes a dominant position in the market of reinforced concrete sleepers and reinforced concrete beams for turnouts. On them Beteltrans, in the opinion of the department, occupies a dominant position (with shares more than 50%). Therefore, the purchase "under certain conditions may lead to a restriction of competition in the commodity markets of Russia." The service issued a prescription to the buyer, but the content is not disclosed. The official said that Beteltrans should execute all short-term and long-term contracts concluded on the date of the transaction, as well as contracts for the purchase and sale of reinforced concrete sleepers and beams. If the price of Beteltrans products increases by more than 15% relative to the weighted average price for the previous year, the enterprise should notify the FAS, proving the change has economic reasons.

The representative of Russian Raiways declined to comment. All attempts to obtain comments from his colleague from T-Industry failed.

Money will return

T-Industry will soon be able to return the invested money. In 2016 and the following years, Beteltrans must pay in dividends at least 25% of net profit after tax. The net profit of Beteltrans for 2016, according to SPARK-Interfax, is 340.4 million rubles. It turns out that for 75% of the shares T-industry can get 255.3 million rubles.

Beteltrans

The largest producer of sleepers
The shareholders are T-Industry (50%), Russian Railways (50%).
Revenue (data of SPARK-Interfax, 2016): 16.3 billion rubles.,
Net profit: 340.4 million rubles.